Opposition Brief — Consolidated Edison Co. v. United States

No. 01-205 OCT S33 2001

Jn the Supreme Court of the Chuted States. « |

CONSOLIDATED EDISON COMPANY OF NEW YORK,

ET AL., PETITIONERS

UNITED STATES OF AMERICA, ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

BRIEF FOR THE FEDERAL RESPONDENTS

IN OPPOSITION

THEODORE B. OLSON

Nolicitor (x hie ral

Co1mpse / of Re cord

ROBERT D. MCCALLUM, JR.

Assistant Atto ‘ney General

BARBARA C. BIDDLE

MARK W. PENNAK

Afforneys

Departin nt of Justice

Washington, 1¢ ‘ 20580-0001

(202) 314-2217

QUESTION PRESENTED

Whether petitioners, public utility companies seeking

declaratory and injunctive relief in district court on

their contractual and constitutional challenge to the

annual Special Assessments levied pursuant to the

Energy Policy Act of 1992 (EPACT), 42 U.S.C. 2297¢ et

seq., had an adequate remedy before the Court of

Federal Claims for purposes of 5 U.S.C. 704, where

petitioners had pending in the Court of Federal Claims

actions challenging EPACT on the same substantive

grounds and seeking refunds of EPACT Special

Assessments already paid by those utilities in earlier

years.

(I)

TABLE OF CONTENTS

Page

Opinions below .......-.secssssessseesseecsneeesneensnnessnecsnessnncennenqnnaqannsnsnsessses l

Bitintt | (a 811) | er 2

Statement ......cccccccccccssssssccsecccsscssscssccssesnessnssscssnssescssensssnascssscsensrsess 2

Argument ........ccsccsessesssceseessesssnsessssssnnensscnssensensenserssencenscnncnnscnssnoss® 8

CONCHUSION ....0..ccceesceeseesesscsscesscsssssccsssssecessnsssssscssensenenscnsssassscssnseenses 22

TABLE OF AUTHORITIES

Cases:

Aetna Cas. & Sur. Co. v. United States, 71 F.3d

AT5 (2d Cir. 1995) .....cccccceereeeeersesressereressseenessnencassnessencnasanncees 11

Beacon Theatres, Inc. v. Westover, 359 U.S. 500

(1959) ....ccccccccssccecersecsssssessssesesssssssasssssssssrscsnsensassasscesasenenssasecsoees 13

Betz v. United States, 40 Fed. Cl. 286, appeal

dismissed, 155 F.3d 568 (Fed. Cir 1998) ....cccceseeeneeeeeees 18

Bowen v. Massachusetts, 487 U.S. 879 (1988)... 2,5,7

8, 9, 10

Califano v. Sanders, 430 U.S. 99 (1977) .ccccscssesesserceeseneseees g

Carolina Power & Light Co. v. United States, 48

Fed. Cl. 35 (2000), appeal pending, No. 01-5040

(Fed. Cir.) cccccsccscssssesssecsseseesssscsescenensessssasensncnsneeencanensnsanensacerecs 29

Castillo Morales v. United States, 19 Cl. Ct. 342

(1990) ........c..cccscccorccsscccssssccsscrsrsssccsossssccsssessnasscssoossnssssnssssssooses 18

Chateaugay, In re, 53 F.3d 478 (2d Cir.), cert. denied,

BIG U.S. 813 (1998) co.cccccscesscscssssceceresseecsesssssenssesenseessssnsnesneees 16

City of Los Angeles v. Lyons, 461 U.S. 95 (1983)... 13

Clapp v. United States, 117 F. Supp. 576 (Ct. Cl.),

cert. denied, 348 U.S. 834 (1954) .....cccseeeeeeeeeeeenenneenenes 19

Clark v. Library of Congress, 750 F.2d 89 (D.C.

Cir. 1984) .......ccccccccccccccccessssssscccsescccssssrscsssscscccsssssssnssssssccsssssses 21

Commonwealth Edison Co. v. United States, 46

Fed. Cl. 29 (2000), appeal pending, No. 00-5069

(Fed. Cir. argued Oct. 3, 2001) ....cesssecssseeenseensenensnseseens 21

(IIT)

lV

Cases—Continued:

Consolidated Edison Co. v. United States, 54 F.

Supp.2d 364 (S.D.N.Y. 1999), appeal dismissed for

lack of jurisdiction, No. 99-6239, 2000 WL 713417

Se CR. TI TA, FD encescsstercertesinenanignenitenininninianianinns

Department of the Army v. Blue Fox, Inc., 525

EU UE TIIIIE cccesscinsh casscdln ous teeashcidiesienndlaceiia ease dimtbenenlcicbiiabdinse

Eagle-Picher Indus., Inc. v. United States, 901

08 SI I Ce BD sesinnecetdlncrteetacrsiriescione

Eastern Enters. v. Apfel, 524 U.S. 498 (1998)...

Eastport S.S. Corp. v. United States, 372 F.2d

ee ees Seals ED pisintiviaskestisohianiaaiiaetntaiatatatcntdldenaihemenate

Hanna v. Plumer, 380 U.S. 460 (1965) oo. eee

Kanemoto v. Reno, 41 F.3d 641 (Fed. Cir. 1994) .....000.....

Katz v. Cisneros, 16 F.3d 1204 (Fed. Cir. 1994) ...............

Lake Mohave Boat Owners Ass'n v. National Park

Serv., 78 F.3d 1360 (9th Cir. 1996) .............ccccccsccssssssscescsees

Maine Yankee Atomic Power Co. v. United States,

44 Fed. Cl. 372 (1999), appeal pending, No. 99-5156

RT CIPD scisseteclishecnnsselesnisthndeeitacihiesieeadicalabeiedepeiddedhuieshalinind

Mallow v. United States, 161 Ct. Cl. 446 (1963) «0.0.00...

Marshall Leasing, Inc. v. United States, 893 F.2d

1096 (9th Cir. 1990) .......... spiesiasiahiilaiaistidinaninaniapeiiantisecitnsiik

Mikohn Gaming Corp. v. Acres Gaming, Inc., 165

Fe ee Cr: Cis ID cetpctetdinircicinisgeniniiinimnninnaininitins

Montalvo v. United States, 231 Ct. Cl. 980

CIRIIEID ncenenniiissnrinnnssennnidiiensicesnanesiainlianieenstaaibnsihiasiticansatinnaliiitnanaiaitastiibine:

Murray v. United States, 817 F.2d 1580 (Fed. Cir.

IBUINED . csvtnsaseninssissctiinahianinenianlpihsincabiebaaneepnaabatioeslataiahsusenisiatianientninialans

North Star Ala. Hous. Corp. v. United States,

9 F.3d 1430 (9th Cir. 1993), cert. denied,

Re Ge aes Se CURE Aichetccaseninseknsddeieccnnnslieidiailainibaapvidietiecinde

Omaha Pub. Power Dist. v. United States, 44

Fed. Cl. 383 (1999), appeal pending, No. 99-5160

(Fed. Cir. argued Nov. 2, 2000) ...cccrccscsssscsasseseressasscssesssceesse

O'Shea v. Littleton, 414 U.S. 488 (1974) wo. eens

Page

21-22

19

20

16

V

Cases——Continued: Page

Polanco v. DEA, 158 F.3d 647 (2d Cir. 1998) .occccccccc--.. 11, 20

Randall v. United States, 95 F.3d 339 (4th Cir.

1996), cert. denied, 519 U.S. 1150 (1997) cocccccccccccccececcsce. 11

Rothe Dev. Corp. v. United States Dep't of Def.,

BOG Fak GRE Cte Cie, BI) ais saecenecscscsnessenstsdnvnssesncsseiniacscace 20)

Sacramento Mun. Util. Dist. v. United States, 44

Fed. Cl. 395 (1999), appeal pending, No. 99-5158

(Fed. Cir. argued Nov. 2, 2000) ..cceccccccccssccscssecssessecscssccesees 22

Sampson v. Murray, 415 U.S. 61 (1974) coccccccccccccsesscecessee, 13,14

Sharp v. Weinberger, 798 F.2d 1521 (D.C. Cir.

SEED sundccenuiniapiatcniatnniambadirctn ce ake ete 16

Student Loan Marketing Ass'n v. Riley, 104 F.3d 397

(D.C. Cir.), cert. denied, 522 U.S. 913 (1997) coc ccccccccccccceee. 16

United States v. Mitchell, 463 U.S. 206 (1983) oo... 18

United States v. Testan, 424 U.S. 392 (1976) cecccccccccccssosee 18

Veda, Inc. v. United States Dep't of the Air Force,

SEE: F OG SF CGC. BR) iscsi cae 11

Virginia Petroleum Jobbers Ass'n v. FPC, 259 F.2d

RE COA. CEP. DON ciscnscecnincsincaasibsentientarcmmancteianal 14

Wabash Valley Power Ass’n v. Rural Electrification

Admin., 903 F.2d 445 (7th Cir. 1990) v..c.ccecccseccccssessesseeceeee 7a

Williamson County Reg'l Planning Comm'n v.

Hamilton Bank, 473 U.S. 172 (1985) ceccccccccccccececcoeees - 14-15, 16

Yankee Atomic Elec. Co. v. United States, 112

F.3d 1589 (Fed. Cir. 1997), cert. denied, 524 U.S.

951 (1998) ......... qeeinnieeehiatinensoninasen Asihdainsinanitcnhicniinibiasmianisinasidades 4

Zelman v. Gregg, 16 F.3d 445 (Ist Cir. 1994) cocccccccceccceoe. 16

Constitution, statutes and regulations:

Fai SNC siictensscdideiaphasbath bebo iene le cece ree 19

RISE js cicsitiinictins iiasdnnconenduinieiadiaiog a eae 21

RT sidibssintkciniediaaiescatieinadss Ae 14,18

Due Process Clause .0........cccccccccscsescssseseseseseceees 15, 17, 19, 21

TU CONE ioiciiaet cee ae One 15, 18

Vi

Statutes and regulations—Continued: Page

Administrative Procedure Act, 5 U.S.C. 701 et seq.:

DU ARs, Tie ctscsccetassbiinitntnteabiaidisiicaiieniadiriaeet a 9,11

BD UTA, Fe cicnisencitstbistimieabitiee ee ee, passim

Energy Policy Act of 1992, Pub. L. No. 102-486, 106

TCGE.. ETO sinceseciesinubtimnanntietestintebinipagiiaitea dias netietiaieemaceiicn ttt aes 2

§ 901, 42 U.S.C. 2297 (106 Stat. 2923) .0.........c5..cccccesceees 2

§ 901(b)(1), 42 U.S.C. 2297 e(D)D) cccccccceccccccccccessscsseees 2

§$ 901(e), 42 U.S.C. 229TD-14(@) .........cceccccscossssssssecsssssesees 2

© £O0E, SE UKs Frere etenisisincestetsinstiittetenntaieetnininaiiasens 3

© SEGA, GE UA, BRD ccsestnsccssnsinsshintansntansncemneses 2

TOE Lah, TB UE as. PE EIEED ccsnstensctieninntenindindiantnaieaniannes 19

SB UBL. Te stteertineeesstindlniteeeeee a 4

SB UK. TED scniticidticunsabiadeaiateaeiens 4

SS WARM. BES cvitintiiccnitniaia ee eee 3]

SD UBA\ EES ctusditsnimiscsiintomisbneans 4

BO Gir like Gs GEN initessnccishianeniniaMaadasliamainanie ata 3

OGTR FD censcsadastenepuitiseeridblanniadcniciihadea tbh beattitaabieeauianars 3

Miscellaneous:

BB FOE, Tams. SE BEG CIGD inccissicicnmsasssthsinisinitisiibnmseaeanmenann. 3

GD Fed, Tam, SED GIO ccescsseissisninesinttsntsanintiiaiiensaniiniaaseaie 3

Jn the Supreme Court of the United States

No. 01-205

CONSOLIDATED EDISON COMPANY OF NEW YORK,

ET AL., PETITIONERS _

v.

UNITED STATES OF AMERICA, ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

BRIEF FOR THE FEDERAL RESPONDENTS

IN OPPOSITION

OPINIONS BELOW

The initial December 5, 2000, opinion of the court of

appeals (Pet. App. 19a-47a) is reported at 234 F.3d 642.

The May 3, 2001, en banc order of the court of appeals

granting the petition for rehearing en banc and re-

turning the matter to the merits panel for issuance of a

revised opinion (Pet. App. 17a-18a) is reported at 247

F.3d 1386. The May 3, 2001, revised opinion of the

panel (Pet. App. la-16a) is reported at 247 F.3d 1378.

The opinion and order of the district court (Pet. App.

48a-59a) is reported at 45 F. Supp. 2d 331.

(1)

JURISDICTION

The judgment of the court of appeals was entered

May 3, 2001. The petition for a writ of certiorari was

filed August 1, 2001. The jurisdiction of this Court is

invoked under 28 U.S.C. 1254(1).

STATEMENT

The Administrative Procedure Act (APA) provides a

cause of action to challenge agency action in federal

district court where “there is no other adequate remedy

in a court” under another statute. 5 U.S.C. 704. By its

express terms, Section 704 “does not provide additional

judicial remedies in situations where the Congress has

provided special and adequate review procedures.”

Bowen v. Massachusetts, 487 U.S. 879, 903 (1988). This

case concerns whether Section 704 permits petitioners,

who can obtain and in fact have already sought judicial

review of their claims in the Court of Federal Claims, to

bring the same claims in an action for prospective relief

in district court under the APA.

1. In 1992, Congress enacted the Energy Policy Act

of 1992 (EPACT), Pub. L. No. 102-486, 106 Stat. 2776.

Under EPACT, the government spun off its uranium

enrichment services to a newly created corporation, the

United States Enrichment Corporation (USEC). See

Pub. Law No. 102-486, § 901, 106 Stat. 2923 (42 U.S.C.

2297). All of the enrichment contracts between the

government and the utilities were assigned to the

USEC. 42 U.S.C. 2297e(b)(1). The transfer became

effective July 1, 1993. 42 U.S.C. 2297b-14(e).

EPACT established the Uranium Decontamination

and Decommissioning Fund (the Fund), which is to be

used to meet the costs of cleaning up government en-

richment facilities. See 42 U.S.C. 2297g-2(b) (establish-

ing the Fund to pay “[t]he costs of all decontamination

ee |

3

and decommissioning activities of the Department [of

Energy] * * * until such time as the Secretary certi-

fies and the Congress concurs, by law, that such activi-

ties are complete”). The Act provides for the federal

government to absorb the lion’s share of the clean-up

costs. In particular, Congress must contribute $330

million annually, or 68% of the total cost, through an-

nual appropriations over a 15-year period, with the

amount adjusted annually to account for inflation. See

42 U.S.C. 2297¢-1.

EPACT further provides that the remaining 32% (a

figure not to exceed $2.25 billion over 15 years) would

be collected in annual installments (not to exceed $150

million per year) over the 15-year period, to be adjusted

annually for inflation, from those domestic utility com-

panies that had used government-enriched uranium in

the generation of electricity. See 42 U.S.C. 2297g-1.

The amount of the fee assessed each domestic utility

company is based on the percentage of enrichment

work units each had purchased from the Department of

Energy, relative to the total number of work units

produced by the Department of Energy over the life of

the enrichment facilities. The formula thus apportions

contributions to the Fund based on each utility’s pro-

rata consumption of uranium enriched by the federal

government. The Department of Energy calculated the

amount to be collected from each utility shortly after

EPACT was enacted and is collecting those sums an-

nually over the 15-year period. See 10 C.F.R. Pt. 766;

58 Fed. Reg. 41,164 (1993); 59 Fed. Reg. 41,956 (1994).

Once a year, each utility is invoiced for its predeter-

mined share of the assessments. See 10 C.F.R. 766.103.

2. Soon after the enactment of EPACT, petitioners

and other utility companies filed several separate suits

in the Court of Federal Claims challenging the EPACT

4

assessments on constitutional and-contractual grounds.

The plaintiffs in those suits asserted that the Court of

Federal Claims had jurisdiction to order the refund of

monies that were “illegally exacted” from them under:

EPACT and paid into the Special Assessment Fund. In

one of those suits, the Federal Circuit reached the

merits of the claims and sustained EPACT against

takings and breach of contract theories of liability. See

Yankee Atomic Elec. Co. v. United States, 112 F.3d

1569 (Fed. Cir. 1997), cert. denied, 524 U.S. 951 (1998).

After the decision in Yankee Atomic, petitioners filed

this action in federal district court in New York, relying

on the same constitutional and contractual claims they

had asserted in support of their “illegal exaction” suits

in the Court of Federal Claims. The United States

moved to transfer the district court case to the Court of

Federal Claims under 28 U.S.C. 1631. Petitioners, the

government argued, could not bring suit under the

APA because they had an “adequate remedy” in another

court within the meaning of Section 704, viz. their still-

- pending refund action in the Court of Federal Claims.

The district court denied that motion. Pet. App. 48a-

~59a. The United States filed an appeal of that denial

to the Federal Circuit, as permitted by 28 U.S.C.

1292(d)(4)(A). Pursuant to 28 U.S.C. 1292(d)(4)(B),

district court proceedings were stayed pending the

decision of the Federal Circuit.

3. In an initial decision issued December 5, 2000, a |

divided panel of the Federai Circuit affirmed. The

majority acknowledged that petitioners had initially

brought suit in the Court of Federal Claims seeking a

refund of the assessments they already had paid into

the Fund. The panel held, however, that petitioners

nonetheless could also file a separate suit in district

court, so long as they sought only declaratory or other

5

equitable relief as to prospective payments. The panel

majority acknowledged that, in so holding, it was

permitting petitioners to “forum shop[]” and thus evade

the Circuit’s earlier decision in Yankee Atomic. Pet.

App. 24a (“This district court case does warrant the

Government’s ‘forum shopping’ characterization.”). The

majority nonetheless held that the Court of Federal

Claims did not provide an “adequate remedy” to

prevent the constitutional wrongs alleged by peti-

tioners under Bowen v. Massachusetts, 487 U.S. 879

(1988), because this case “features a complex ongoing

relationship to decontaminate and decommission

nuclear facilities.” Pet. App. 30a. The majority

concluded that “[{iJn this complex ongoing relationship,

this court, like the Supreme Court in Bowen, cannot be

sure that a money judgment will adequately substitute

for prospective relief,” which, the court opined, “lies

beyond the powers of the Court of Federal Claims.”

[bid.

Judge Gajarsa dissented. Pet. App. 33a-47a. The

Court of Federal Claims, Judge Gajarsa reasoned, has

jurisdiction over all of petitioners’ constitutional and

contractual claims in the pending refund suits in the

Court of Federal Claims. Because petitioners had a

fully adequate remedy in the Court of Federal Claims,

he explained, suit under the APA was not authorized

by 5 U.S.C. 704. Disagreeing with the majority’s asser-

tion that the case involves a “complex ongoing relation-

ship” of the type found in Bowen, Judge Gajarsa ex-

plained that “[a] decision by the CFC [in plaintiffs’

pending suits] would effectively moot any prospective

relief that the district court could afford.” Pet. App.

41a-42a. If the Court of Federal Claims were to hold

the assessments unlawful, he noted, that decision would

have the effect of declaratory relief: The decision

6

“would be binding and it is absurd to believe that the

| Department of Energy] would continue to require the

domestic utilities to make payment of unlawful exac-

tions.” Jd. at 42a.

4. The Federal Circuit granted rehearing en banc,

vacated the December 5, 2001, panel decision, and re-

turned the case to the merits panel; the panel in turn

issued a‘unanimous “revised opinion” to “accompan|y]”

the en bane court’s order. Pet. App. 18a. The new

panel decision reversed the district court’s refusal to

transfer the case to the Court of Federal Claims, hold-

ing that the Court of Federal Claims could provide a

fully adequate remedy to adjudicate all of petitioners’

claims. As a result, the panel concluded, the district

court lacked jurisdiction under Section 704 of the APA

to adjudicate petitioners’ claims. /d. at 8a-9a.

The court of appeals distinguished this Court’s de-

cision in Bowen. Noting that the Court in Bowen had

expressed doubts as to whether the Court of Federal

Claims had jurisdiction to entertain the actions, the

court of appeals explained that “this case presents

no jurisdictional problems” because “[t]he Court of

Federal Claims has long possessed jurisdiction to con-

sider constitutional claims, such as [petitioners’] claims

about the EPACT assessments, under the ‘illegal

exaction’ doctrine.” Pet. App. 10a. Indeed, the court

noted that “the factual background and the consti-

tutional claims at issue in the current litigation overlap

with those already before the Court-of Federal Claims”

in several other lawsuits. Jd. at lla.

The court of appeals also distinguished Bowen on the

ground that it involved a complex, ongoing relationship -

between the federal government and the States under

the Medicaid program. The EPACT program, the court

observed, is unlike the Medicaid program, because “the

relationship between Con Ed and the United States

features a known and fixed series of payments over

time,” whereas the Medicaid statutory program fea-

tured “shifting populations and demographics, advan-

cing medical technologies, unforeseeable health threats,

and varying state and federal economic conditions.”

Ibid.

The court of appeals further noted that the Medicaid

controversy at issue in Bowen “typically involve[s]

state governmental activities that a district court would

be in a better position to understand and evaluate than

a single tribunal headquartered in Washington.” Pet.

App. lla (quoting Bowen, 487 U.S. at 907-908). In con-

trast, “this case does not involve a state at all” but

“relates to a contract between the utilities and the

Government, and specifically, the utilities’ financial

obligations under EPACT.” Jbid. In sum, the court

concluded, this case does not “involve ‘[mJanaging the

relationships between States and the Federal Govern-

ment that occur over time and that involve constantly

shifting balance sheets,’” and thus does not involve

“state governmental activities that a district court

would be in a better position to understand and evalu-

ate.” Ibid. (quoting Bowen, 487 U.S. at 904 n.39, 907-

908).

The court of appeals also concluded that “the pro-

cedural background and facts of this case indicate that

the Court of Federal Claims can supply an adequate

remedy even without an explicit grant of prospective

relief.” Pet. App. 12a. Noting that petitioners had

already alleged the same constitutional and contractual

theories of recovery in seeking refunds in illegal exac-

tion suits in the Court of Federal Claims, the court

reasoned that success on those claims for retrospective

relief would effectively provide petitioners with pro-

8

spective relief. If petitioners prevailed in those suits,

the court reasoned, “the United States could not pro-

ceed to assess further EPACT payments without again

illegally exacting funds.” Jbid. Noting that res judicata

principles “would require immediate refund” of any

such assessment, the court stated that “this court can-

not imagine that the United States would continue to

require the utility companies to pay unlawful exac-

tions.” Jbid. As a result, “[rJelief from [petitioners’]

retrospective obligations will also relieve [them] from

the same obligations prospectively.” Jbid.

Finally, the court of appeals noted that the “pro-

cedural background of this case seals the conclusion

that [petitioners have] an adequate remedy in the

Court of Federal Claims.” Pet. App. 18a. Noting that

petitioners’ district court suit had been filed only after

the adverse decision in Yankee Atomic, the court rea-

soned that petitioners had simply “artfully recast

[their] complaint to cireumvent the jurisdiction of the

Court of Federal Claims,” engaging in “blatant forum

shopping to avoid adequate remedies in an alterative

forum.” Id. at 13a, 14a. The court explained that

“lelvery legal issue that [petitioners] seek[] to resolve

in this district court case could be (and, in some cases,

has been) decided in a suit before the Court of Federal

Claims.” Jd. at 14a.

ARGUMENT

The court of appeals’ decision is correct and does not

conflict with any decision of this Court or any decision

of any other court of appeals. Further review therefore

is not warranted. |

1. Petitioners’ principal argument is that the court

of appeals’ decision is inconsistent with Bowen v.

Massachusetts, 487 U.S. 879 (1988). Pet. 11. Bowen,

aN ee en Pe nem Ta en ee Ec ee eT

9

petitioners appear to argue, stands for the broad pro-

position that complaints seeking prospective or injunc-

tive relief automatically “fall within the exclusive

domain of the district courts.” Pet. 14. That reading of

Bowen is overbroad, incorrect, and textually irreconcil-

able with 5 U.S.C. 704.

} The Administrative Procedure Act (APA) does, as a

general matter, provide a cause of action to challenge

; agency action in district court, subject to certain limits.

Jurisdiction for such suits is conferred by 28 U.S.C.

1331; and the APA, 5 U.S.C. 702, expressly waives sov-

ereign immunity from such suits to the extent they do

not seek money damages.’ See, e.g., Califano v.

Sanders, 430 U.S. 99 (1977). Section 704, however,

limits the availability of such actions by permitting

them only when “there is no other adequate remedy in

a court” under another statute. 5 U.S.C. 704. As this

Court has explained, Section 704 “does not provide

additional judicial remedies in situations where the.

Congress has provided special and adequate review

procedures.” Bowen, 487 U.S. at 903. Thus, if adequate

review may be obtained in another forum, such as the

Court of Federal Claims under the Tucker Act, Section

704 precludes litigants such as petitioners from seeking

review under the APA.

Here, the Federal Circuit concluded that a lawsuit in

the Court of Federal Claims, brought under the Tucker

. Act for a refund of money illegally exacted, would pro-

| vide petitioners with “adequate” review. Nothing in

Bowen contradicts that conclusion. To the contrary, in

Bowen, the Court specifically observed that a Tucker

Act suit in the Court of Federal Claims can “offer pre-

! Petitioners do not dispute that their district court suit was

brought against the United States under the APA.

10

cisely the sort of ‘special and adequate review pro-

cedures’ that § 704 requires to direct litigation away

from the district courts.” Bowen, 487 U.S. at 900-901

n.31; see also zd. at 904 n.39. Under the specific cireum-

stances presented in Bowen, of course, the Court ex-

pressed concern that the Court of Federal Claims might

not have had jurisdiction over the claims at issue there.

Here, in contrast, the Federal Circuit was confident

that the Court of Federal Claims had jurisdiction.

Nor can petitioners persuasively argue that, for some

fact-specific reason peculiar to this case, an action in the

Court of Federal Claims under the Tucker Act would

be inadequate. While petitioners filed this suit seeking

prospective relief in district court, they have also filed

precisely the same substantive claims in the Court of

Federal Claims, demanding retrospective relief. As the

Federal Circuit explained, if petitioners were to prevail

in the Court of Federal Claims suit, “the United States

could not proceed to assess further EPACT payments

without again illegally exacting funds.” Pet. App. 12a.

Because res judicata principles “would require immedi-

ate refund” of any such assessment, “[rJelief from [peti-

tioners’] retrospective obligations [would] also relieve

[them] from the same obligations prospectively.” bid.

Indeed, “a decision by the Court of Federal Claims [in

these cases] would effectively moot any prospective

relief that the district court could afford.” Jd. at 14a.

The various court of appeals cases that petitioners

cite are not to the contrary. Whether or not an alterna-

tive remedy is “adequate” necessarily must be exam-

ined on a case-by-case basis, and none of the decisions

cited by petitioners remotely resembles the current

case. Not one of them involved litigants that had al-

ready brought suit for retrospective relief in the Court

of Federal Claims and then—following the issuance of

ee ee

il

unfavorable Federal Circuit precedent—filed almost

identical claims in APA actions for prospective relief in

district court. Nor did any of them hold, as petitioners

suggest, that an otherwise available Tucker Act rem-

edy must automatically be considered “inadequate” for

purposes of Section 704 merely because the plaintiff, in

the APA action, requests prospective relief.”

For similar reasons, the decision below does not, as

petitioners assert, limit Bowen “to its own facts.” Pet.

16. The inquiry established by Bowen is always the

2 For example, while petitioners rely on Polanco v. DEA, 158

F.3d 647 (2d Cir. 1998), the court in Polanco found that the

plaintiffs there could not bring any action at all—for retrospective

or prospective relief—in the Court of Federal Claims under the

Tucker Act. 158 F.3d at 652 & n.3. Polanco, moreover, is

questionable authority following this Court’s decision in Depart-

ment of the Army v. Blue Fox, Inc., 525 U.S. 255 (1999). Ad-

dressing the scope of the waiver of sovereign immunity in 5 U.S.C.

702, the Court in Polanco held that Section 702’s bar against suits

seeking “money damages” is inapplicable so long as the plaintiff

seeks “equitable relief.” 158 F.3d at 652. Blue Fox, however,

makes it clear that “the equitable nature of the” relief sought “does

not mean that [the] ultimate claim was not one for ‘money

damages.’” 525 U.S. at 262. Petitioners’ reliance on Randall v.

United States, 95 F.3d 339 (4th Cir. 1996), cert. denied, 519 U.S.

1150 (1997), is misplaced for similar reasons. There, as in Polanco

and unlike here, the plaintiff could not bring a suit for “monetary

damages on which to premise jurisdiction under the Tucker Act.”

Id. at 348. Finally, petitioners’ reliance on Veda, Inc. v. United

States Department of the Air Force, 111 F.3d 37 (6th Cir. 1997),

and Aetna Casualty & Surety Co. v. United States, 71 F.3d 475 (2d

Cir. 1995), is misplaced, because those decisions do not address

Section 704, and nowhere address the adequacy of the Tucker Act

remedy. Instead, they address only whether the actions were for

“money damages” within the meaning of 5 U.S.C. 702. On that

issue, moreover, they (like Polanco) are questionable authority

following Blue Fox.

12

same, i.e., whether the alternative remedy is “adequate”

for purposes of Section 704 of the APA. Here, the court

‘of appeals noted that the factors that had led to the

finding of inadequacy in Bowen were completely absent.

Unlike in Bowen, in this case there is no doubt as to

whether the Court of Federal Claims will assert juris-

diction. Moreover, unlike in Bowen, there is no “com-

plex, ongoing federal-state relationship”; there are no

“constantly shifting balance sheets”; and there are no

“state governmental activities.” Nor do petitioners

suggest any other factor that might render a Tucker

Act remedy inadequate.

In essence, petitioners insist that one may always

avoid the express mechanism for review provided by

the Tucker Act by asking for prospective relief that the

Court of Federal Claims cannot grant. As the court of

appeals properly recognized, there simply is no basis

for that bright-line rule, particularly where, as here, the

claimants were pursuing substantially the same claims

retrospectively under the Tucker Act at the time they

filed their APA suit. Indeed, the rule in the Federal

Circuit as well as in other circuits long has been that

“{a] party may not avoid the [Court of Federal Claims’]

jurisdiction by framing an action against the federal

government that appears to seek only equitable relief

when the party’s real effort is to obtain damages in

excess of $10,000.” Kanemoto v. Reno, 41 F.3d 641, 646

(Fed. Cir. 1994). This rule makes clear what petitioners

conveniently ignore: The courts are not bound by a

plaintiff’s allegations of the need for prospective relief.

Rather, the courts assess jurisdictional questions by

reference to the “true nature of the action.” Katz v.

Cisneros, 16 F.3d 1204, 1207 (Fed. Cir. 1994). See also

Pet. App. 13 (citing authorities from other circuits).

13

In this case, the “true nature” of petitioners’ district

court suit was to avoid the jurisdiction of the Court of

Federal Glaims (and that of the Federal Circuit), where

petitioners had initially filed suit but where other utili-

ties have been unsuccessful on the merits. Seeking to

escape the same fate, petitioners hope now to recover

the EPACT assessments already paid by obtaining a

declaration in district court, and then using that decla-

ration as res judicata and collateral estoppel in their

suits to recover past payments now pending in the

Court of Federal Claims. Petitioners’ purported need

for prospective relief is thus a fiction.

Indeed, petitioners cannot claim that the unavail-

ability of injunctive relief in the Court of Federal

Claims renders suit in that forum inadequate, because

petitioners are not entitled to equitable relief in any

court, including in district court under the APA. The

traditional rule is that equitable relief ‘s unavailable

where there is an adequate remedy at law. See, e.g.,

Sampson v. Murray, 415 U.S. 61, 88 (1974) (“The basis

of injunctive relief in the federal courts has always been

irreparable harm and inadequacy of legal remedies.”)

(quoting Beacon Theatres, Inc. v. Westover, 359 U.S.

500, 506-507 (1959)); Mikohn Gaming Corp. v. Acres

Gaming, Inc., 165 F.3d 891, 898 (Fed. Cir. 1998) (same).”

As noted in Sampson, “[t]he possibility that adequate

compensatory or other corrective relief will be available

at a later date, in the ordinary course of litigation,

* See also City of Los Angeles v. Lyons, 461 U.S. 95, 111 (1983)

(“The equitable remedy is unavailable absent a showing of irre-

parable injury.”); O'Shea v. Littleton, 414 U.S. 488, 502 (1974)

(noting that “[rJespondents have failed, moreover, to establish the

basic requisites of the issuance of equitable relief in these

cireumstances—the likelihood of substantial and immediate irre-

parable injury, and the inadequacy of remedies at law’’).

14

weighs heavily against a claim of irreparable harm.”

415 U.S. at 90 (quoting Virginia Petroleum Jobbers

Ass’n v. FPC, 259 F.2d 921, 925 (D.C. Cir. 1958)). Here,

petitioners have filed an action for such corrective,

compensatory relief in the Court of Federal Claims.

Because that suit can offer petitioners legal relief, they

have no, basis for seeking equitable relief under the

APA. Indeed, the district court in this case (in the

context of a discovery order) reached precisely that

conclusion. Petitioners could not meet the equitable

requirement of irreparable injury, the court found,

because petitioners have a fully adequate remedy at

law in the Court of Federal Claims in the form of a suit

for a refund of any assessment illegally exacted. See

Consolidated Edison Co. v. United States, 54 F. Supp.

2d 364 (S.D.N.Y. 1999), appeal dismissed for lack of

jurisdiction, No. 99-6239, 2000 WL 713417 (2d Cir. May

11, 2000). For the same reason, they lack the irrepar-

able injury necessary to obtain permanent injunctive

relief.

2. Petitioners also assert (Pet. 19-22) that the de-

cision below conflicts with Eastern Enterprises v.

Apfel, 524 U.S. 498 (1998). That contention is without

merit. As an initial matter, Eastern Enterprises did

not concern the meaning or effect of 5 U.S.C. 704. In-

stead, it concerned whether a “takings” claim under the

Fifth Amendment is premature if a Tucker Act remedy

is available. 524 U.S. at 521 (plurality opinion). As the

Court explained in Williamson County Regional Plan-

ning Commission v. Hamilton Bank, 473 U.S. 172, 193-

* Petitioners’ citation of cases regarding the availability of

judicial review, Pet. 17-18, is beside the point. The question here is

not whether review is available. It is where that review should be

had.

15

195 (1985), a claim that the government has taken

property without “just compensation” ordinarily is

premature—because no violation has yet occurred—

until available means of obtaining compensation have

been employed and compensation has been denied.

Here the question is not whether a takings claim is ripe.

It is whether the APA and Section 704 afford peti-

tioners an alternative avenue for relief in view of their

already pending actions in the Court of Federal Claims.

More fundamentally, the plurality in Eastern Enter-

prises concluded that Congress did not intend to remit

the plaintiffs in that case to a Tucker Act remedy. Dis-

tinguishing the Court’s earlier decisions, which sug-

gested that the availability of a Tucker Act remedy

renders any takings claim in federal district court

premature, the plurality concluded that “in a case such

as” Eastern Enterprises itself, “it cannot be said that

monetary relief against the Government is an available

remedy” because “[t]he payments mandated by the

Coal Act, although calculated by a Government agency,

are paid to the privately operated Combined Fund,”

and Congress did not contemplate “that the Treasury

would compensate coal operators for their liability

under the Act.” 524 U.S. at 521. Accordingly, the

plurality reasoned, in a situation involving mandated

payments by one private party to another, the “pre-

sumption of Tucker Act availability must be reversed.”

Ibid. Here, by contrast, EPACT requires domestic

utility companies to pay assessments directly to the

United States and petitioners seek a refund of pay-

ments from the United States.

Eastern Enterprises is also distinguishable because

there, unlike here, the claims were all premised on the

Due Process Clause and the Takings Clause. Here, in

contrast, petitioners also contend (in multiple counts of

16

the complaint) that the EPACT assessments violate

their contract and settlement rights with the govern-

ment. Such contract matters plainly fall within the

exclusive jurisdiction of the Court of Federal Claims.

Indeed, it is well established that the district courts

have no power under the APA to award declaratory or

equitable relief on contract claims.”

3. Petitioners contend (Pet. 23-26) that this Court

should grant review because the decision below creates

a conflict among the circuits concerning the proper

5 See, e.g., Sharp v. Weinberger, 798 F.2d 1521, 1524 (D.C. Cir.

1986) (Sealia, J.) (“We know of no case in which a court has

asserted jurisdiction either to grant a declaration that the United

States was in breach of its contractual obligations or to issue an in-

junction compelling the United States to fulfill its contractual

obligations.”); Zelman v. Gregg, 16 F.3d 445, 448 (1st Cir. 1994)

(“equitable relief cannot be obtained on contract claims against the

government”); North Star Ala. Hous. Corp. v. United States, 9

F.3d 1430 (9th Cir. 1993) (en banc) (same), cert. denied, 512 U.S.

1220 (1994); Eagle-Picher Indus., Inc. v. United States, 901 F.2d

1530, 1532 (10th Cir. 1990) (APA’s waiver of sovereign immunity

“does not extend to actions founded upon a contract with the

United States”); Wabash Valley Power Ass’n v. Rural Electrifi-

cation Admin., 903 F.2d 445, 452 (7th Cir. 1990) (effort to obtain

specific performance of promise allegedly made by an agency not

within district court’s jurisdiction). Petitioners’ claim (Pet. 21-22)

that the decision below conflicts with Jn re Chateaugay, 53 F.3d 478

(2d Cir.), cert. denied, 516 U.S. 813 (1993), and Student Loan

Marketing Ass'n v. Riley, 104 F.3d 397 (D.C. Cir.), cert. denied,

522 U.S. 913 (1997), fails for the same reasons as petitioners’ claim

of conflict with Eastern Enterprises. Both of those cases address

the ripeness of takings claims in light of Williamson County,

supra, rather then the availability of an APA action under 5 U.S.C.

704; neither involved contract claims; and neither involved litigants

that already had takings claims pending in the Court of Federal

Claims when they filed suit for declaratory relief in another forum.

17

forum for the litigation of due process claims. That

purported conflict is illusory.

In this case, the court of appeals held that peti-

tioners’ due process claims were cognizable in the Court

of Federal Claims under the “illegal exaction” doctrine.

Pet. App. 5a. Court of Federal Claims and Federal Cir-

cuit precedent hold that that doctrine permits plaintiffs

to recover under the Tucker Act monies illegally taken

by the government, even if the plaintiff cannot identify

a statute mandating the return of funds. The Court of

Federal Claims has observed:

[I]t is not every claim involving or invoking the

Constitution, a federal statute, or a regulation which

is cognizable here. The claim must, of course, be for

money. Within that sphere, the non-contractual

claims we consider under Section 1491 can be divided

into two somewhat overlapping classes—those in

which the plaintiff has paid money over to the

Government, directly or in effect, and seeks return

of all or part of that sum; and those demands in

which money has not been paid but the plaintiif

asserts that he is nevertheless entitled to a payment

from the treasury. In the first group (where money

or property has been paid or taken), the claim must

assert that the value sued for was improperly paid,

exacted, or taken from the claimant in contravention

of the Constitution, a statute, or a regulation.

Eastport S.S. Corp. v. United States, 372 F.2d 1002,

1007 (1967).

Petitioners assert that their due process claims can-

not be asserted in the Court of Federal Claims because

the Due Process Clause is not a “money-mandating”

cause of action. Pet. 23. Petitioners correctly recognize

the general rule that the Court of Federal Claims lacks

18

jurisdiction over due process claims. That consti-

tutional provision, unlike the Just Compensation Clause

of the Fifth Amendment, does not itself mandate the

payment of money in compensation for the plaintiff's

loss. See United States v. Testan, 424 U.S. 392,

400 (1976); United States v. Mitchell, 463 U.S. 206, 216-

217 (1983) (plaintiff generally “must demonstrate” that

the “source of substantive law he relies upon can fairly

be interpreted as mandating compensation by the

Federal Government for the damage sustained”) (em-

phasis added) (internal quotaticn marks omitted). See,

e.g., Murray v. United States, 817 F.2d 1580, 1582-1583 -

(Fed. Cir. 1987); Montalvo v. United States, 231 Ct. Cl.

980, 982-983 (1982). But petitioners ignore the fact that

the Court of Federal Claims permits monetary re-

covery under the Tucker Act in the absence of a money-

mandating statute or constitutional provision if the

plaintiff can assert an “illegal exaction” claim of the sort

recognized in Easiport. Specifically, the Court of

Federal Claims permits a plaintiff to seek damages

under the Tucker Act if the “value sued for was improp-

erly paid, exacted, or taken from the claimant in contra-

vention of the Constitution, a statute, or a regulation.”

Eastport S.S. Corp., 372 F.2d at 1007; see, e.g., Castillo

Morales v. United States, 19 Cl. Ct. 342, 345 (1990); Betz

v. United States, 40 Fed. Cl. 286, appeal dismissed, 155

F.3d 568 (Fed. Cir. 1998).

Thus, following Eastport, Tucker Act jurisdiction has

been recognized if the claim arises either (1) under a

“money-mandating” statute or constitutional provision,

or (2) under a claim that the money sought by the

plaintiff has been “illegally exacted” by the government

from the plaintiff in contravention of a statute or consti-

tutional provision. See Testan, 424 U.S. at 400-402

(noting and distinguishing the illegal exaction theory of

- 19

Eastport and explaining that, in the absence of such a

claim, the jurisdiction of the Court of Federal Claims

“depends upon whether any federal statute can fairly

be interpreted as mandating compensation by the

Federal Government for the damage sustained”). In

Mallow v. United States, 161 Ct. Cl. 446 (1968), for

example, the Court of Claims held that it had juris-

diction over a suit seeking to recover an illegally

exacted fine, either as a claim founded upon an Act of

Congress, or as a ciaim founded upon the Constitution.

See also Clapp v. United States, 117 F. Supp. 576 (Ct.

Cl.) (upholding illegal exaction theory as basis for

jurisdiction), cert. denied, 348 U.S. 834 (1954). In this

case, the court of appeals merely applied that same

doctrine to hold that petitioners could bring a Tucker

Act suit to recover the sums that were allegedly

exacted from them in violation of the Due Process

Clause.

Bowing to that weight of authority, petitioners do not

question whether the Court of Federal Claims has

applied the illegal exaction theory to adjudicate statu-

tory claims. Rather, petitioners assert that such juris-

diction cannot extend to constitutional claims, such as

their due process claims. Pet. 24-25. Petitioners, how-

ever, offer no reason why the illegal exaction doctrine,

as articulated by the Federal Circuit, would be limited

to statutory claims. The text of the Tucker Act clearly

contemplates adjudication of constitutional issues. It

affords the Court of Federal Claims jurisdiction to

render judgment “upon any claim against the United

States founded either upon the Constitution[] or any

Act of Congress.” 28 U.S.C. 149i(a)(1). Petitioners

offer no reason why the illegal exaction doctrine would

apply differently for claims “founded * * * upon

* * * any Act of Congress” than it does for claims

20

“founded * * * upon the Constitution” when the

Tucker Act mentions both in the same clause.

Finally, petitioners’ contention (Pet. 23-24) that there

is a conflict in the circuits on this issue is without merit.

Most of the cases cited by petitioners simply do not

address the scope of the illegal exaction doctrine. For

example, Rothe Development Corp. v. United States

Department of Defense, 194 F.3d 622 (5th Cir. 1999)

(cited at Pet. 23), nowhere holds that a plaintiff may

bring a due process claim in district court notwith-

standing its ability to bring a Tucker Act illegal

exaction claim for precisely the same constitutional

injuries. To the contrary, in that case the court held

that it lacked jurisdiction over the appeal—and that the

appeal had to be transferred to the Federal

_Circuit—because the suit sounded in quasi-contract and

arose under the Tucker Act. Jd. at 626. Moreover, in

Rothe the plaintiff could not have brought a claim for

the return of illegally exacted money in the Court of

Federal Claims because the plaintiff there had not paid

money to the government. Instead, the suit challenged

the government’s decision to award a contract opportu-

nity to one of the plaintiff’s competitors. /d. at 623.

The remaining cases cited by petitioners are similarly

distinguishable. And certainly none holds that liti-

® Polanco v. DEA, supra (cited at Pet. 23), for example, in-

volved an allegedly defective forfeiture, and nowhere addressed

whether the piaintiff could have brought a Tucker Act suit under

an illegal exaction theory. Further, as explained above (p. 11 n.2,

supra), Polanco’s analysis of whether the APA action was barred

by sovereign immunity has been superseded by this Court’s more

recent decision in Blue Fox. Similarly, neither Marshall Leasing,

Inc. v. United States, 893 F.2d 1096, 1101 (9th Cir. 1990) (cited at

Pet. 24), nor Lake Mohave Boat Owners Ass’n v. National Park

Service, 78 F.3d 1360, 1365 (9th Cir. 1996) (cited at Pet. 23),

21

gants, such as petitioners, that have already filed due

process actions in the Court of Federal Claims—and

over which the Court of Federal Claims has exercised

jurisdiction under the illegal exaction doctrine—may

later bring the same claims in district court under the

APA.

Ultimately, the fallacy of petitioners’ argument is

most apparent from petitioners’ own actions. Notwith-

standing their assertion that substantive due process

constitutional claims cannot be brought in the Court of

Federal Claims, petitioners in fact have brought pre-

cisely such claims in that court seeking a refund of their

payments of prior EPACT assessments. Such a will-

ingness to undermine their own claims can only be ex-

plained by petitioners’ desire to escape adverse Federal

Circuit precedent, such as Yankee Atomic.’ In what

considered the illegal exaction theory, much less rejected it. And

Clark v. Library of Congress, 750 F.2d 89 (D.C. Cir. 1984) (cited at

Pet. 24), is even further afield. In that case, the plaintiff claimed

that the government had violated his First Amendment rights -by

dismissing him; and he sought reinstatement to his former posi-

tion. Because the plaintiff had not paid any money to the govern-

ment, an illegal exaztion claim—under the First Amendment or

the Due Process Clause—was not a possibility.

* While petitioners assert (Pet. 11) that Yankee Atomic did not

directly decide the due process and takings questions presented in

their Court of Federal Claims and district court actions, Yankee

Atomic directly decided a takings claim and disposed of the con-

tract claims asserted by petitioners. Yankee Atomic thus stands

as a direct roadblock to petitioners’ lawsuit. Furthermore, the

same constitutional claims involved in this case have been rejected

on the merits by the Court of Federal Claims in five other cases

brought by other nuclear utilities, including Commonwealth

Edison and Carolina Power, both of whom are named plaintiffs in

petitioners’ district court tion. See Omaha Pub. Power Dist. v.

United States, 44 Fed. Cl. 383 (1999), appeal pending, No. 99-5160

(Fed. Cir. a¥gued Nov. 2, 2000); Maine Yankee Atomic Power Co.

22

the court of appeals properly characterized as “forum-

shopping,” Pet. App. 24a, petitioners are plainly seeking

“to circumvent the jurisdiction of the Court of Federal

Claims,” id. 13a, so as to escape adverse precedent.

That sort of forum shopping should not be countenanced

by the courts. See, e.g., Hanna v. Plumer, 380 U.S. 460,

468 (1965).

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted.

THEODORE B. OLSON

Solicitor General

ROBERT D. MCCALLUM, JR.

Assistant Attorney General

BARBARA C. BIDDLE

MARK W. PENNAK

Attorneys

NOVEMBER 2001

v. United States, 44 Fed. Cl. 372 (1999), appeal pending, No. 99-

5156 (Fed. Cir. argued Nov. 2, 2000); Sacramento Mun. Util. Dist.

v. United States, 44 Fed. Cl. 395 (1999), appeal pending, No. 99-

5158 (Fed. Cir. argued Nov. 2, 2000); Commonwealth Edison Co. v.

United States, 46 Fed. Cl. 29 (2000), appeal pending, No. 00-5069

(Fed. Cir. argued en banc Oct. 3, 2001); Carolina Power & Light

Co. v. United States, 48 Fed. Cl. 35 (2000), appeal pending, No. 01-

5040 (Fed. Cir.).